In the linked auction, there's a hidden payout drawer that slides out on the front.
The payout mechanism was automatic, and would dump the nickels into the cup in the payout drawer. Payout could be disabled.
Different machines had different payout sensibilities. Some extremely high payouts paid in tokens or printed sheets (!) that could be turned in for cash if you 'knew the person'. Some paid directly. Others were used as a trade stimulator effort where different types of tokens would be paid out - say one gives you a free shot of whiskey, another gives you a couple of free cigarettes. The idea being that if you kept pumping nickels into the pinball or countertop slot machine, you'd be paying the establishment either way. Spend 5c for a shot or 35c... I know which I'd prefer as the business owner...
The trick with most of these machines was staying one step ahead of the law. For example, in some localities it might be fine to provide a slot machine/trade stimulator -if- the customer was guaranteed something for every pull. That's why you'll see a lot of machines with mint or gum vendors attached. No one cared about the mint or gum!